"If you look at where stock is trading, it's as if handsets are destroying value but they are extremely profitably and will continue to be even with Apple [set to unveil] the iPhone 6," he said.
"Handset earning are projected by most people to decline dramatically, but we think they will hold up. We also see better profit growth from semiconductors than expected," he added.
Profit in the mobile division reached 6.43 trillion won, down 1.2 percent from a 6.51 trillion won profit a year earlier, but up 18 percent from 5.47 trillion won in the previous quarter.
Read MoreGalaxy S5s with broken cameras 'limited': Samsung
Samsung shipped 113 million handsets in the first quarter with the proportion of smartphones in the high 70-percent range. The company said it expects second-quarter handset shipments to be similar to the January-March period, though smartphones should make around 80 percent of handset shipments in the April-June quarter.
In the chip business, profits rose 82 percent on year to 1.95 trillion won, thanks to solid demand from PC makers and tight supply.
"Going forward, we now see the majority of earnings growth coming from semiconductors, particularly memory," Newman said.
Newman is not alone in his optimism outlook for Samsung's stock.
Daniel Kim, analyst at Macquarie Securities has a 12-month price target of 1.8 million won, representing upside of 30 percent.
Read MoreThis is how much Samsung's Galaxy S5 costs to build
He says a combination of the stock's cheap valuation, positive earnings momentum, lowered expectations around Samsung as well as the potential for shareholder return will be key drivers.
"Samsung is gathering cash at a faster-than-expected pace. This increases the likelihood that the company will return cash to shareholders in the form of dividends or stock buybacks," Kim said.
Newman agrees, noting that as Samsung's growth slows and its cash pile reaches unprecedented levels, the question of how to unlock shareholder value by returning cash is now paramount.
Read MoreCan Samsung's Galaxy S5 take on the next iPhone?
"Any clarity around this critical issue should provide a significant lift to the stock," he said.
Looking at the stock from a technical perspective, Daryl Guppy, an independent technical analyst, expects the recent uptrend in Samsung's stock to continue. Guppy has an initial target of 1.5 million won for the stock.